California offers $3,500 instant rebate for first-time EV buyers on cars up to $50,000

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California is rolling out a new $3,500 rebate for zero-emission vehicles.

It has a price cap of $50,000, but that’s lifted for certain automakers.

State is also streamlining DMV and expanding access to digital licenses.

The Trump administration eliminated the clean vehicle tax credit last year, but states and cities can offer incentives of their own. California is doing exactly that as Governor Gavin Newsom has announced residents buying their first zero-emission vehicle can get $3,500 off at dealerships.

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The “instant rebate” goes into effect this summer and is the result of a new piece of legislation that sets aside $135.5 million for an “affordable clean-car future to be matched by an equal contribution from participating automakers.”

More: Used Hybrid And EV Prices Jumped $3,600 After The Tax Credit Died

The program is known as MyFirstEV and it provides $3,500 off new electric vehicles with an MSRP of up to $50,000. Customers can also get $1,750 off the price of used electric vehicles priced up to $25,000.

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While that sounds pretty straightforward, there’s some interesting fine print including that vehicles can’t have a curb weight exceeding 8,500 lbs (3,856 kg). More importantly, there’s a special carve out for “California-headquartered zero-emission vehicle” companies.

Specifically, “incentives under the program shall be provided to California-headquartered zero-emission vehicle companies regardless of the vehicle manufacturer’s suggested retail price or sales price.” In effect, automakers – like Rivian – with headquarters in California don’t have to worry about the price cap.

The state appears to know this is unfair and possibly illegal, so there’s a special section that says “If a court of competent jurisdiction holds that the application of paragraph (2) is invalid, the remainder of this section shall remain in force and effect as if this section had not included paragraph (2).” This means if a court determines the California HQ rule is improper, it won’t doom the whole program.

That sounds a little sketchy, but Newsom’s office said the state surpassed 2.5 million cumulative zero-emission vehicle sales in January, which far exceeded their goal of 1.5 million. They added California is now home to 200,000 public and shared EV charging plugs.

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In a politically charged statement, Newsom said “ Donald Trump is doing everything in his power to pollute our air and surrender the clean car industry to China on a silver platter. California is putting its foot on the accelerator. With our new instant rebate program for electric vehicles, we’re making it easier for families to drive clean, breathe clean, and keep more money in their pockets.”

DMV Changes

In other automotive-related news, Newsom signed a separate bill designed to modernize the state’s Department of Motor Vehicles (DMV), cut costs, and expand access to mobile driver’s licenses. In regards to the latter, the cap on the Mobile Driver License Pilot Program has increased from 15% to 60%.

This means millions of more Californians will now be able to get a digital license . The state added that over 3.5 million residents have applied for one since the program launched in August 2023.

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Other changes are less flashy, but are aimed at reducing costs and streamlining operations. In particular, the bill allows for “eliminating certain mailed notices, ending the requirement to print physical driver handbooks, and modernizing how the department communicates with customers about renewals.”